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Market Recap: RISI Crow’s Construction Materials Cost Index
A price index of lumber and panels used in actual construction for July 22, 2011
*Western – regional species perimeter foundation; Southern – regional species slab construction.
Crow’s Market Recap — A condensed recap of the market conditions for the major North American softwood lumber and panel products as reported in Crow’s Weekly Market Report.
LUMBER: SPF lumber producers sold modest volumes, which ate away at order files. However, demand for 2×6 and wider #2&Btr kept upward pressure on those prices in the West. Limited supplies coming out of the East enabled mills in that region to hold prices. Prices in the Southern Pine lumber market continued to gain traction. Reduced production schedules over the past month, combined with some added demand, have helped provide more price stability. Improved sales of dry items in the Coastal species lumber market during the latter half of the week improved the likelihood of mills holding onto quoted levels. Green Doug Fir prices faltered, especially 2×6 #2&Btr. Some Inland species lumber producers have spot surpluses and have lowered their numbers on selected items. Others, not needing to scrub surpluses, have actually elevated their prices. Thus, spreads are wider this week among most Inland mills. Ponderosa Pine lumber is more available. Both 5/4 and 6/4 Shop are less difficult to source. Nonetheless, prices are very firm, and buyers continue to seek Shop in reasonable volumes. The price of #2&Btr Common was weaker than either #3 or #4. Lack of demand has been apparent all year, and is a strong indicator of those moderate big-box sales. Idaho White Pine remains in very modest production, and those who have any are holding their prices very firm. Eastern White Pine mills remain very stable and firm on their prices. All Radiata Pine prices are very firm. Extreme heat limited consumption of Western Red Cedar. Buyers purchased sparingly, keeping inventories in line with takeaways and wanting quick shipments. Prices remained stuck in the same quagmire.
PANELS: Western Fir plywood producers reported flat pricing intermingled with the occasional buildup of floor stocks, which were subsequently discounted. Sales into the week of Aug. 1 were achieved, but quicker shipping volumes remained available. Without the full participation of customer bases in the Southern Pine plywood market, sales were moderate yet enough to keep prices from weakening. OSB markets seem to be attempting to stabilize, although overall energy is still lacking. Canadian plywood price levels remain at or very near the numbers that have been used for the last two weeks, with producer spreads still showing a fairly wide range. Particleboard and MDF price increases across much of the South gave the impression that more was taking place than actually happened. These price gains were the result of price increases that had been announced earlier.
Midwest Gloves & Gear offers ladies garden clogs
Midwest Gloves & Gear introduced new Ladies Garden Comfort Clogs. The lightweight, comfortable design is molded in advanced EVA material in the latest fashion colors. Removable insoles provide added comfort, and the clogs are easy to clean by rinsing off with a garden hose.
Comfort Clogs is a registered trademark of MidWest Quality Gloves, based in Chillicothe, Mo. The company markets a full line of premium quality work gloves, including lined leather, unlined leather, leather palm, chemical resistant, chore, jersey and cotton.
In addition, MidWest Gloves & Gear brand products encompass full glove lines of automotive gloves, outdoor gloves and garden gloves. The full gear lines are garden accessories, lawn and garden footwear, boots and rainwear. MidWest products are distributed internationally to the retail, commercial and industrial markets.
Losses narrow at Builders FirstSource
Builders FirstSource, one of the industry’s largest pro dealers, reported $206.4 million in sales for the second quarter of 2011, a decrease of 2.4% over sales of $211.5 million in the second quarter a year ago. The company attributed the decline to commodity price deflation, which was partially offset by a slight increase in sales volume, the company said.
Net loss for the Dallas-based LBM chain was $15.5 million, compared with a net loss of $19 million in the corresponding period of 2010.
During the current quarter, Builders FirstSource recorded $1.9 million of facility closure costs primarily related to the closure of a distribution facility in Georgia.
“We are very encouraged by our second-quarter results, as our near break-even adjusted EBITDA was our best operating performance since the third quarter of 2007,” said Floyd Sherman, CEO at Builders FirstSource. “We finished the current quarter with sales of $206.4 million, down just 2.4% compared with sales of $211.5 million in the second quarter of 2010. While U.S. single-family housing starts and average commodity prices were down 13.1% and 20.8%, respectively, over this same time period, our sales volume was up slightly, which we believe is indicative of significant market share gains during the quarter.”
Sherman added: “Though there continues to be a significant amount of uncertainty in the macro-economic factors that drive housing demand, we are seeing positive trends in our results in spite of the difficult environment.”
Builders FirstSource operates 51 distribution centers and 46 manufacturing facilities in nine states, often on the same site, principally in the southern and eastern United States. Manufacturing facilities include plants that manufacture roof and floor trusses, wall panels, stairs, aluminum and vinyl windows, custom millwork and pre-hung doors.